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Cross Border Payments now Require Prior Approval
On 9 March 2012, the Argentine Central Bank released Communication "A" 5295 establishing that the payment of certain services to non-residents will be subject to prior approval of the Argentine Central Bank. This would be in cases where (i) the beneficiary is an individual or legal entity "related" to the local debtor, following the definition of "related entities" set forth by Argentine foreign exchange regulations (with certain differences in respect to the definitions contemplated in tax and corporate regulations); (ii) the beneficiary is a resident or is incorporated or domiciled in any of the jurisdictions listed by Decree 1344/98 (i.e., low or nil tax jurisdictions); or (iii) payments are made to a bank account situated in any of such low or nil tax jurisdictions. Taxand Argentina analyses which services will require prior approval from the Central Bank.
Cross border payment of services subject to the previous approval of the Argentine Central Bank related to the following:
- Business, professional and technical services
- Royalties, patents and trademarks
- Premiums related to loans of sportsmen
- Personal, cultural and recreational services
- Payment of commercial guarantees related to the export of goods and services
- Exploitation rights of foreign films, video and sound
- Services regarding technology transfer regulated by Law 22,426 (except for patents and trademarks)
- Other information and computing services
The prior approval of the Argentine Central Bank will not be required if contracts do not entail payments and/or debts that exceed US$ 100,000 during each calendar year.
In addition, as a previous condition to have access to the local exchange market, it is required to duly accomplish any mandatory registration of the contracts due at the federal level at the date of access to the local exchange market.
Declaring the payment of certain services will come into force as of 3 April 2012. Businesses which make payments or have debts exceeding US$100,000 per calendar year should make sure that they comply by obtaining prior approval from the Argentine Central Bank before making payments of certain services to non-residents.
Your Taxand contacts for further queries are:
T. +5411 5288 2300
T. +5411 5288 2300
Lucia Peralta Krogslund